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Wednesday, July 17, 2013

The media should be asking questions about the participation of a City-County Council member, who earns a living as an architect, being allowed to serve on a selection committee to choose the winning proposal to receive a multi-million dollar subsidy from city taxpayers. According to an Indianapolis Star story announcing the selection of Flaherty & Collins as the winning proposal to develop the former Market Square Arena site, the City's Department of Metropolitan Development included Osili on the selection committee. The City plans to donate $18 million in borrowed taxpayer funds utilizing a downtown TIF district and gift a prime parcel of real estate valued at $5.6 million to Flaherty & Collins to construct a 28-story, $81 million luxury apartment building. While taxpayers will be on the hook to finance 30% of the cost of the development, they will receive no ownership interest in the project. Osili's enthusiastic support for the government-financed project is not shared by all of his fellow council memberes.

City-County Council member Vop Osili, who served on the committee that helped select the winning entry, concurred. He said the tower’s design, by the Chicago office of Baltimore-based RTKL Associates, is “new, beautiful and iconic architecture.”

An RTKL principal, Patrick Murphy, said the tower will be made of reinforced concrete with a metal and glass facade. Its rounded corners will allow more of the building to be enclosed within less surface area, he said, which should lower construction costs and bring more energy savings compared with a standard box-like building.

The city’s subsidy isn’t a sure thing. Approval is needed from the Democratic-majority council to issue bonds. City leaders say they also are considering asking the council to expand the Downtown TIF district to include the site.

The project had support from Osili, a Democrat, but some of his colleagues were skeptical.

“If there’s truly a demand and it’s financially attractive to do these types of projects,” said Angela Mansfield, a Democrat, “then they should be self-funding. The city should not be giving away land and they should not be basically funding the private investors’ profits. I’m at a loss to understand why they don’t see that. I’m sure our constituents are not thrilled about it, either.”

Democrat Zach Adamson said he was wary of the city giving developers land along with direct subsidies. That same mix of city aid also is being used for a planned $48 million mixed-use development on a Massachusetts Avenue block housing Indianapolis Fire Department buildings.

“I don’t think the development sounds like a bad idea, and I know we’re going to have to shell something out,” Adamson said. “But it sounds like a lot.”

My concern is that the Ballard administration has essentially bought off the support of Councilor Vop Osili on important measures coming before the City-County Council by allowing him to use his position as leverage to win professional services contracts for his own business. Osili has primarily relied on government-financed projects which set aside a certain percentage of the professional services work to minority-owned businesses like his own. The architectural work on this project is being done by a Chicago-based firm, RTKL. While RTKL is not a minority-owned firm, it often has to subcontract professional services contracts it wins with minority-owned firms as a condition to receiving a government contract. Osili's support of the Flaherty & Collins project allows him to leverage his participation in other projects that Flaherty & Collins and RTKL perform elsewhere.

The financial disclosure statements filed by City-County Council members tell us very little about where persons like Osili earn their money. It lists his ownership of A + X Design & Development and past ownership and employment with A2SO4, which has benefitted largely from set-aside contracts on government projects for minority-owned firms. Osili should be required to disclose who is clients are. Has he performed for Flaherty & Collins in the past, or is he under contract to work on future projects planned by Flaherty & Collins. Has Osili performed work for RTKL as a subcontractor in the past, or is he under contract to perform work on future projects RTKL may be performing. The Ballard administration relied on Osili's support for a major expansion of the downtown TIF district last year, a proposal that specifically requires developers, city contractors and other firms receiving economic development benefits within the expanded TIF area to meet certain local hiring goals.

As Jon Murray's story points out, council approval of the bond issue to finance the $18 million contribution from city taxpayers is required. By including Osili in the executive decision-making role, the Ballard administration has violated the constitutional separation of powers. Osili will now get to vote and lobby his fellow council members to support an executive decision he helped reach. As this blog has complained frequently about in the past, some council members use their council positions as cash cows for themselves. The only way to prevent this from happening is to require greater transparency in the public reporting requirements for council members.

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